Short answer. He loses the protection of limited liability towards the creditors he misled. A limited partner whose surname appears in the firm name, outside the two exceptions the Civil Code allows, is liable as a general partner to creditors who extended credit without actually knowing he was only a limited partner.
What the law says
A limited partner whose surname appears in a partnership name contrary to the provisions of the first paragraph is liable as a general partner to partnership creditors who extend credit to the partnership without actual knowledge that he is not a general partner.
Civil Code, Article 1846 — Surname of a Limited Partner. Read the full provision →
The rule and the two exceptions
The starting point is a prohibition: the surname of a limited partner is not supposed to appear in the partnership name at all. The Civil Code allows only two escapes. The first is where the same surname is also the surname of a general partner — the name then tells the public nothing false, because a general partner really does answer for the firm. The second is where the business was already being carried on under a name containing that surname before the person became a limited partner. In that situation the name is a piece of history rather than a representation about who currently stands behind the debts.
Why the law treats a name as a representation
A limited partner enjoys a rare privilege: he risks only what he put in. That privilege depends on the outside world being able to tell who is fully exposed and who is not. A firm name is the loudest signal a business sends, and a surname in it reads to lenders and suppliers as a statement that the person named stands behind the venture. Allowing an investor to enjoy the credit-worthiness his name attracts while keeping the shelter of limited liability would let him have the benefit without the exposure. The article closes that gap by matching the liability to the appearance created.
The liability is limited to those actually misled
The provision does not convert the limited partner into a general partner for all purposes. It exposes him to partnership creditors who extended credit without actual knowledge that he was not a general partner. A creditor who knew the real position — because the certificate was shown to him, because he was told, or because he plainly dealt with the firm on that footing — cannot invoke the rule. Nor does the provision rewrite his relations with his co-partners; internally he remains a limited partner, with whatever contribution, profit share and rights of contribution the partnership agreement gives him.
What to do if the name is already in use
The exposure runs while the name is out there, so the sensible response is to change the firm name and the registration, then make sure the corrected name appears on invoices, contracts, signage and correspondence. Written disclosure of the limited partner's status to lenders is worth keeping, because the article turns on the creditor's actual knowledge. Note that a name can also become a problem for a limited partner in other ways — most obviously if he takes part in controlling the business — and that separate rules govern the certificate of limited partnership and its amendment. This is general information, not advice on your particular firm.